Digitalbox PLC (AIM:DBOX, FRA:RLXB), the owner of The Daily Mash, The Tab and The Poke, has signed up more than 200 online creators in an attempt to reduce its reliance on traffic from social media platforms.
The Creator Network, launched this year, is intended to scale up the company's original video output and open new revenue lines beyond conventional digital publishing.
Digitalbox expects to be publishing around 500 original videos a month by October.
The strategy is a direct response to changes at Meta, the owner of Facebook and Instagram, which has reweighted its algorithms to favour content made by individual creators.
Those changes hit Digitalbox's audience numbers from the second quarter onwards and have prompted a rebasing of expectations for the year.
Investors were told revenue and earnings before interest, tax, depreciation and amortisation for the full year to come in below market expectations.
Consensus had pointed to revenue of £5 million and adjusted earnings of £800,000.
First-half revenue fell 12% to about £1.7 million and earnings were roughly breakeven.
Second-half revenue is expected to fall by a similar low double-digit percentage against last year, with the company taking what it called a cautious view.
Cost cuts have been made and Digitalbox now expects a full-year earnings margin of about 8%, with the investment in the Creator Network itself contributing to the squeeze.
Cash stood at about £2 million at the end of June.
The company said advertising performance, session values and yields had all improved year on year, with the problem lying in audience volumes rather than the rates it can charge.
Trading was strong in the first quarter before the Meta changes took effect, and June brought some recovery in engagement.
Digitalbox is also pitching branded content services to advertisers across both text and video, arguing that artificial intelligence is disrupting the media market and increasing the value of trusted publishing brands.
The Creator Network will sit alongside The Tab Student Network and the group's Entertainment Network, which includes TV Guide and soap opera sites such as Coronation Street Insider.
James Carter, chief executive, said the company was building a business less reliant on traditional publishing economics.
Interim results are due on 23 September.
